- Prachi Singh |
Total sales in the first quarter rose by 19.4 million euros (21 million dollars) or 6.5 percent at OVS. The company said, OVS brand increased its sales by 4.6percent or 11.5 million euros (12.8 million dollars), despite inventory count carried out in February 2017 and the leap year in 2016. UPIM sales increased by 7.8 million euros (8.7 million dollars) or 16.4 percent and the brand also increased profitability. EBITDA was equal to 29.3 million euros (32.7 million dollars), an increase of 3 million euros (3.3 million dollars) or 11.2 percent, 40 bps of margin improvement compared to the same period in 2016.
"OVS SpA continued to grow in the first quarter of 2017, with net sales increasing by 6.5 percent and EBITDA increasing by 11.2 percent thanks to good like-for-like sales performance as well as the network expansion, with central costs under control. 2017 targets are confirmed. The favourable weather conditions starting from the second half of May resulted in an acceleration of the positive dynamics of the first quarter. Finally, the expansion plan as of today is continuing with the further network expansion of 15 stores in franchising and five directly operated,” commented Chief Executive Officer Stefano Beraldo in a statement.
Both OVS brands contributed positively to EBITDA growth
Both divisions contributed positively to the achievement of improved EBITDA result, benefitting from an improvement in gross margin, despite a significant increase in the franchise channel, a profitable expansion of the network, and a corresponding benefit in terms of operating leverage. EBITDA of both brands was up on the previous year, with OVS increasing by 1.1 million euros (1.2 million dollars), while UPIM’s growth of 1.8million euros (2 million dollars), 270 basis points margin improvement, as the new openings show significantly better metrics than the average of the existing brand.
Operating income, at 16.9 million euros (18.8 million dollars), was up by 2.5 million euros (2.7 million dollars) or 17.4 percent compared to the same period of last year. Earnings before tax were 13.8 million euros (15.4 million dollars), up 3 million euros (3.3 million dollars) year on year.
“During the period, 11 directly operated full format stores and 42 stores in franchising (mainly kids) were opened. In addition to the positive consolidation of the domestic market, which is proceeding as envisaged, the internationalization process of OVS SpA is continuing in line with expectations, through the network expansion of a further nine stores, out of which five directly operated and four in franchising. The integration with Charles Vögele and the consequent external international growth is in line with the plan, both in terms of store conversions and central costs rationalization,” added Beraldo.